George Taylor Jr.

Wilmington entrepreneur George Taylor Jr. pleaded guilty to not paying more than $2 million in employment taxes and not filing employment tax returns, according to a news release from the U.S. Attorney's Office on Thursday.

The release stated that Taylor is scheduled to be sentenced on Nov. 19 and faces a maximum penalty of five years in prison in the case related to one of his companies, National Speed.

“He also faces a period of supervised release, restitution and monetary penalties,” according to the release. “A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.”

Taylor, who owned and operated high-performance speed shop National Speed, gained attention in recent years for starting a brewery to address gang violence, but that brewery, TRU Colors, failed in 2022.

His guilty plea, which was entered Wednesday according to court documents, however, dealt solely with National Speed, an automotive services business with locations in Wilmington and Richmond, Virginia, according to National Speed’s website.

One of Taylor's attorneys, Douglas Kingsbery of Raleigh-based Tharrington Smith LLP, said Taylor has accepted responsibility by pleading guilty and paying the taxes owed. 

"The failure of a business to timely remit employment taxes is a criminal offense. Mr. Taylor pleaded guilty to that offense because, as he readily admits, he was the person at National Speed who was ultimately responsible for making sure the company timely remitted those taxes," Kinsbery said in an emailed statement. "It should be noted that Mr. Taylor never received any personal financial benefit from the company’s employment tax arrearage. Also, after accepting responsibility for the situation, he personally paid the company’s entire employment tax arrearage. No former employee of the business has been harmed, and the IRS has now received all the employment taxes that were due."

But U.S. Attorney Michael Easley said in the release that “for years, this businessman took millions from employees’ paychecks, supposedly for taxes, and spent it to pad his business and personal expenses.”

According to court documents and statements, as chairman and president of National Speed, Taylor was responsible for withholding Social Security, Medicare and income taxes from employees’ wages and paying those taxes to the IRS, the Eastern District U.S. Attorney's Office release stated.

From 2014 through 2021, Taylor withheld the taxes, but did not pay those withholdings to the IRS, nor did he file the necessary employment tax returns, according to the release.

“During the same period, he also did not pay the employer’s share of those taxes to the IRS,” the release stated.

The release said Taylor caused a tax loss to the IRS of $2,272,072.

In April 2021, Taylor “did willfully fail to truthfully account for and pay over the trust fund taxes due and owing to the IRS on behalf of the employees of National Speed for the calendar quarter ending on March 31, 2021,” the U.S. Attorney’s Office stated in introductory allegations filed earlier this summer. (Click here to read the court document.)

Efforts to reach Jordan Watson, founder of National Speed, were not immediately successful Thursday.
 
That was more than a year before TRU Colors abruptly shut down in September 2022.

Before TRU Colors, Taylor acquired Untappd and started NextGlass, both beer-related tech startups based in Wilmington.